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pipbanker

Why Trading Moving Averages Fail? Nr. 1 Loser Indicator

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Ok

I know a lot of you are using the most popular indicator in the Market (Moving Average). What you do not realize is that is that MA is the #1 loser in the market. Don't get me wrong, all indicators are losers, but MA is the leader.

 

Here is the bottom line.

Indicators are not really the problem. It is the instruction that comes with them and people that use them is the problem.

 

Let's take for example MA.

This is by far the most abused indicator in the world. It has lost so much money it should have been illegal to use it. Incidentally, no one seems to realize that.

Most trading system in the market follows the wisdom of the MA crossing strategy. 90% of trading system has some type of MA crossing scheme in it. Most indicators (MACD, Stoch, ADX, CCI) are build around that concept. That is why all indicators or EA (automated trading system) in general are garbage. Yes, I said it. They are all garbage.

 

What is the reason for MA cross failure? When looking at MA or any indicators based on MA one needs to understand that price does not care where your moving average is in relation to current price. Market does not care where moving average is pointing or if your indicator is overbought or oversold. MA cross happens too late for an entry and usually when you see the cross and ready to put on a trade the price will go the opposite direction. Tadah! Not again. And you will wander why? You did follow your trading plan as you were taught but there was another loss...Frustration? No, it is more than that...

 

Having said all that, where do a wanna forex trader should turn for help? The truth is there no one that can help you because the answer would be too simple for you to accept and follow. No one can help you except for yourself.

 

For example:

I trade against everything that I have learned in forex trading classes. I trade against everything the books, the technical gurus, the TV, the market analysis, the news, even the TREND. Yes, I trade against the trend. So when I talk about trading most traders will stay away from what I am saying because it makes no sense to them. Others will hate me for making money trading against all the rules that market "gurus" preach.

 

I am going to share what I do and get some stones and mud thrown at me in the process.

It should be fun to watch and read the comments I will be getting. So sit back and relax as I am going to unleash my sac of garbage.

 

Here is how I trade.

I only Buy Low and Sell High using my naked eye and simple support and resistance levels. I DO NOT USE MA CROSSING. IT IS DUMB TO USE MA CROSSING.

 

Bellow is a summary of what I do to prepare for a trade:

(and yes, I do trade without indicators )

 

1. I don't do any analysis on weekends or days before. When I open my chart I look at a Daily Time Frame. I am not too concern about all these technical analysis. They are too confusing and too boring for me to be wasting my time on. As you may already know, most of your trades are always ending up in the wrong side. So the forex market itself does not follow technical analysis when it comes to taking my money so why should I?

2. I determine the intermediate term trend with the H4 and H1 to see where the price is in relation to past price action. This is easy to do with your naked eye. No need for expensive indicator. If you are addicted to indicators then do like the others are doing. Drop a 200 EMA on your charts and say to yourself if the price is above the 200 EMA, the trend is up and if the price is below it the trend is down.

3. I look at where the price is located in relation the highest point in the chart and the lowest point. Or for new guy, this means the highest the price has been before returning back down and the lowest the price has been before returning back up. You can do all this with your naked eye.

4. I am waiting for the price to reach my levels to take the trade.

5. I do use 5M to spot and trade true support and true resistance.

6. I only risk less than 2% of my account on any trade.

7. I follow my stop loss rules and let life goes on.

 

And yes, sometimes I do trade even without all this stuff described above. Just be there in the right time and with right order. Sometimes I am lucky to reach my day target in first 5-10 minutes of session opening. This does not happen everyday, but this happens pretty often to mention it. With no indicators at all.

 

So if you want to learn trading you have to get rid off anything that clutters your chart.

 

Now go ahead and crucify me. I might enjoy some of your comments.

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Yep you're right, you'll be crucified for just being another vendor trying to get people and their credit cards excited. If you made money trading, you wouldn't be offering a trading room.

 

Here are the ONLY three ways to consistently make money in the markets:

 

1) Be at the top of a company during an IPO and be granted thousands of shares

2) Privileged inside information that catches a company or general market(of your choosing) off guard

3) Have enough money to continually double down forever at increasing quantities until the market turns in your direction and then stagger your exits. Oh wait, that's our good friend Golden Slacks receiving infinite money at .25%

 

Kurtosis and statistics don't even work anymore. HFT robots battling each other day after day has made all the markets truly random.

 

Edit: I forgot a fourth method that works in the markets. Sell a trading room or something of the like for $200-$500 per month and hook people for 2-3 months before they move on. You can probably make a comfortable living of $50k-$100k per year doing this.

Edited by ValueAreaTrader

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Yep you're right, you'll be crucified for just being another vendor trying to get people and their credit cards excited. If you made money trading, you wouldn't be offering a trading room.

 

Here are the ONLY three ways to consistently make money in the markets:

 

1) Be at the top of a company during an IPO and be granted thousands of shares

2) Privileged inside information that catches a company or general market(of your choosing) off guard

3) Have enough money to continually double down forever at increasing quantities until the market turns in your direction and then stagger your exits. Oh wait, that's our good friend Golden Slacks receiving infinite money at .25%

 

Kurtosis and statistics don't even work anymore. HFT robots battling each other day after day has made all the markets truly random.

 

Edit: I forgot a fourth method that works in the markets. Sell a trading room or something of the like for $200-$500 per month and hook people for 2-3 months before they move on. You can probably make a comfortable living of $50k-$100k per year doing this.

 

Ok, I see you are a little upset with people who are able to make money trading, but this is not your fault. Let me comment on few things you said.

1.There is no IPO in forex and futures, probably you know that, but I need to say that for any newbies who could be reading this post.

2. Yes, you can make money without having insiders in forex and futures. It would be hard to imagine that many people have access let's say to numbers prior to NFP.

3. Not all traders are willing to join the market without proper education. It might sound unbelievable to you but there are traders who want to be educated properly. I am not talking about education quality here, cause that would take us in to long debate.People can make their choice if they want to learn or not. We only give the opportunity to learn profitable trading, please don't get so angry about it. I don't think you get angry at people who teach English or other stuff.

4. Turning a struggling trader into a profitable one is not about watching videos and reading manuals. If you give me a valid reason why I should spend my personal time educating a trader for free then I will enroll you at no cost. You will like to be on the other side.

There are many things to be discussed on this matter, but I will stop here.

Yes, people can join our trading room for free.

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Since we have people happy with MAs, I think it would be interesting to know how many people are trading with MAs and if they are happy about performance.

Would you agree that having a poll would be the right thing here?

 

I've created a poll here

Take a look at this screen to see where exactly the poll is. http://screencast.com/t/HWzDs4dLlon

HWzDs4dLlon

 

2 weeks to vote should be enough to get some valid info. I will post results in 2 weeks here.

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No two traders that I know trade exactly alike. Whatever works for you is the best way to trade imho. And I've been trading for over 20 yrs. The markets change their MO almost daily so there is no one best method or indicator. Price is the only indicator of value. If you are new to trading you need to do some reading and take some courses from the recognized leaders in trading education. Then you can truly learn to trade by piecing together a strategy and methodology that works for you. Since we all learn at different speeds and trading is so psychologically influenced by our individual personalities, some will learn quickly. Some will take years to learn (I did) and some will never learn and eventually give up when they run out of expendable funds.

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trading with MA is like flying an airplane...

 

those who can fly looks like god to those who can't.

 

those who can't fly but fly anyway will have a predictable future

 

there are those who can't fly, believes nobody should either

 

there are those who can't fly, have other means of transportation, therefore not flying is not a big deal

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trading with MA is like flying an airplane...

 

those who can fly looks like god to those who can't.

 

those who can't fly but fly anyway will have a predictable future

 

there are those who can't fly, believes nobody should either

 

there are those who can't fly, have other means of transportation, therefore not flying is not a big deal

 

I just got a warm feeling inside Tams..

 

Both optimists and pessimists contribute to the society. The optimist invents the aeroplane, the pessimist the parachute.

 

— George Bernard Shaw

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Ha.... I wish I had an airplane, Sometimes I think I'm just driving a tractor or golfcart or something! ;)

 

For other newbies, beware that MA is just univariet time series analysis. The next tick can't be predicted. The market is a complex system that can't be predicted based on past action. So time series analysis is a method that doesn't fit the model.

 

MA are only useful if others make decisions based on them. So a system using MA might work, but only until it stops working...

 

Look instead for ways to understand other traders, buyers and sellers, supply and demand. The price history is their footprints. Are they running ahead or are they trapped?

 

Good luck to everyone in 2012!

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Ok

 

1. I don't do any analysis on weekends or days before. When I open my chart I look at a Daily Time Frame. I am not too concern about all these technical analysis. They are too confusing and too boring for me to be wasting my time on. As you may already know, most of your trades are always ending up in the wrong side.

 

:wtf:Gee, I wish someone had told me last year that using moving average strategies were losers. I guess making 4.3 % month over month (60% per year) for the last 16 months using a moving average strategy is just a total loss.

 

With your above quote I can see why you will always lose money in the long run and badmouth successful strategies. Using technical analysis is too confusing and too boring??? What I am hearing is you don't want to put the effort into making your strategy a winner. Sorry guy, but I think I would rather study hard, analyze the data and come to my own conclusions without being distracted by someone who can't be bothered with confusing and boring technical analysis.

 

I know I sound harsh but I have heard this too many times in too many forums and yet with perseverance, research, copious back and forward testing, I am able to tweak the moving averages to give me a profit on 87% of my trades.

 

I will grant you one thing, too many indicators will make trading more difficult and confusing, the same as trying to watch too many currency pairs.

 

Good luck with your trading. I think I will stick with mine. :)

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One of the best and certainly most consistent traders I know successfully uses Moving Averages coupled with cycles.

 

You should reconsider.

 

"Cycles"? If you dont mind expanding on this. Never heard of cycles before

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I have heard and read many stories of successful traders using MA on various places on the net but never seen it with my own naked eyes, however from the last years experience in trading I can say they do work not that I use them but they seem to strong sign with some delay not good for agressive traders but better for conservative. I use 30, 50, and 100 MA's looking for bounces between the 30, 50 I understand market movers use these MA's.

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We are getting interesting results on the vote, but it is still open.

If you have an opinion on this subject put your vote in at http://www.pipbanker.com

The poll is in the right top corner. We will put the total count here after we close the poll.

 

And by the way, Friday 13th had fantastic moves, congrats too everyone who was able to catch that drop in markets.

good weekend to everyone

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Moving Averages work all the time anyone who says they dont they dont know what a chart is or what one looks like.

 

Backtest it last few months and you will see its best to trade after a multiple cross when there is angle and seperation and price always bursts in that direction.

 

the 20, 50 and 200 MA are used by most traders.

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Moving Averages work all the time anyone who says they dont they dont know what a chart is or what one looks like.

 

Backtest it last few months and you will see its best to trade after a multiple cross when there is angle and seperation and price always bursts in that direction.

 

the 20, 50 and 200 MA are used by most traders.

 

Hey mate,

 

in back testing they work fine, dont they?

But there is a problem, my broker does not let me trade in the middle of the chart. And that's where all problems begin. MA fail in forward testing or in real trading. Otherwise all those traders out there would be rich by just trading MA cross. But we know what the truth is... they are not making money.

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Moving Averages work all the time anyone who says they dont they dont know what a chart is or what one looks like.

 

Backtest it last few months and you will see its best to trade after a multiple cross when there is angle and seperation and price always bursts in that direction.

 

the 20, 50 and 200 MA are used by most traders.

 

could u explain further...Have you used Moving Averages in live trading and what are your results...

please also tell us what time frame do you use ?

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We are getting interesting results on the vote, but it is still open.

If you have an opinion on this subject put your vote in at Forex Learn Profitable Trading Without Indicators | A Unique Forex Trading Course | Forex Trading Strategies | High frequency trading | Daytrading for dummies | Day Trading | Scalping | Best Forex Secrets

The poll is in the right top corner. We will put the total count here after we close the poll.

 

And by the way, Friday 13th had fantastic moves, congrats too everyone who was able to catch that drop in markets.

good weekend to everyone

 

I have been using the following MA Crossover formula with tremendous success:

 

If average(vendorpost,3) crosses over average(tolerancelevel,8) then exit thread at market;

 

I think perhaps it works so well because the MA lengths are both fib numbers - what do you think PipBanker?

 

Bluehorseshoe

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We are getting interesting results on the vote,

but it is still open.

If you have an opinion on this subject put your vote in.

We will put the total count here after we close the poll.

... and ... ?

 

I assume the poll is still open, since we have not had the result posted :shocked:

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I know a lot of you are using the most popular indicator in the Market (Moving Average). What you do not realize is that is that MA is the #1 loser in the market. Don't get me wrong, all indicators are losers, but MA is the leader.

 

Here is the bottom line.

Indicators are not really the problem. It is the instruction that comes with them and people that use them is the problem.

 

Let's take for example MA.

This is by far the most abused indicator in the world. It has lost so much money it should have been illegal to use it. Incidentally, no one seems to realize that.

Most trading system in the market follows the wisdom of the MA crossing strategy. 90% of trading system has some type of MA crossing scheme in it. Most indicators (MACD, Stoch, ADX, CCI) are build around that concept. That is why all indicators or EA (automated trading system) in general are garbage. Yes, I said it. They are all garbage.

 

What is the reason for MA cross failure? When looking at MA or any indicators based on MA one needs to understand that price does not care where your moving average is in relation to current price. Market does not care where moving average is pointing or if your indicator is overbought or oversold. MA cross happens too late for an entry and usually when you see the cross and ready to put on a trade the price will go the opposite direction. Tadah! Not again. And you will wander why? You did follow your trading plan as you were taught but there was another loss...Frustration? No, it is more than that...

 

Having said all that, where do a wanna forex trader should turn for help? The truth is there no one that can help you because the answer would be too simple for you to accept and follow. No one can help you except for yourself.

 

For example:

I trade against everything that I have learned in forex trading classes. I trade against everything the books, the technical gurus, the TV, the market analysis, the news, even the TREND. Yes, I trade against the trend. So when I talk about trading most traders will stay away from what I am saying because it makes no sense to them. Others will hate me for making money trading against all the rules that market "gurus" preach.

 

I am going to share what I do and get some stones and mud thrown at me in the process.

It should be fun to watch and read the comments I will be getting. So sit back and relax as I am going to unleash my sac of garbage.

 

Here is how I trade.

I only Buy Low and Sell High using my naked eye and simple support and resistance levels. I DO NOT USE MA CROSSING. IT IS DUMB TO USE MA CROSSING.

 

Bellow is a summary of what I do to prepare for a trade:

(and yes, I do trade without indicators )

 

1. I don't do any analysis on weekends or days before. When I open my chart I look at a Daily Time Frame. I am not too concern about all these technical analysis. They are too confusing and too boring for me to be wasting my time on. As you may already know, most of your trades are always ending up in the wrong side. So the forex market itself does not follow technical analysis when it comes to taking my money so why should I?

2. I determine the intermediate term trend with the H4 and H1 to see where the price is in relation to past price action. This is easy to do with your naked eye. No need for expensive indicator. If you are addicted to indicators then do like the others are doing. Drop a 200 EMA on your charts and say to yourself if the price is above the 200 EMA, the trend is up and if the price is below it the trend is down.

3. I look at where the price is located in relation the highest point in the chart and the lowest point. Or for new guy, this means the highest the price has been before returning back down and the lowest the price has been before returning back up. You can do all this with your naked eye.

4. I am waiting for the price to reach my levels to take the trade.

5. I do use 5M to spot and trade true support and true resistance.

6. I only risk less than 2% of my account on any trade.

7. I follow my stop loss rules and let life goes on.

 

And yes, sometimes I do trade even without all this stuff described above. Just be there in the right time and with right order. Sometimes I am lucky to reach my day target in first 5-10 minutes of session opening. This does not happen everyday, but this happens pretty often to mention it. With no indicators at all.

 

So if you want to learn trading you have to get rid off anything that clutters your

 

Beachmaster

 

First post. You do what works for you. To win in this game you must have a plan. To take money from brokers

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There are number of traders using indicators and claiming that they are using profitable indicators as well. So, it is really new for me to know that all indicators are losers, but MA is the leader.

 

Not only MA is the leader but MA is enough (alongwith S/R levels) ...RSI,Stochastics or MACD may be the other options to put onto charts but imo they are not needed either as they are some form of moving averages themselves...

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    • Date : 30th September 2020.ADP, NFP and the change in their correlation.Today ADP reported a 749k sure in private payroll employment in September, almost double the 400k expectation, after an upwardly revised 481k (was 428k) increase in August.There were solid gains across industries. The service sector added another 552k jobs, with the goods sector adding 196k. Manufacturing jobs were up a hefty 130k. In services, trade/transport posted a big 186k gain, while leisure/hospitality jobs increased 92k, and education/health employment was up 90k. Professional/business services added 78k jobs. The ADP gains have massively undershot improvement in BLS payrolls and other labor market indicators since the growth rebound began, suggesting that this could continue despite this month’s solid gain. However please note that during the pandemic year ADP has done an awful job as an indicator of NFP number. In general after since May we have seen the absence of correlation between the ADP employment change figures with Nonfarm Payrolls.The September Nonfarm Payroll gain is seen at 900k, as most measures of output extended their rebounds in September. Initial claims have slowly tightened, and we saw another big -1,912k continuing claims plunge between the August and September BLS survey weeks. The jobless rate is expected to hold steady from 8.4%, alongside a 0.8% September hours-worked increase with a 34.6 workweek and hourly earnings to be unchanged, following August’s 0.4% rise, as the measure gives back more of the 4.7% April pop with the shift in the composition of jobs back toward lower-paid workers. The nonfarm payroll forecast assumes a 1,075k private jobs increase.Seasonal Trends and WeatherFor disruptions to employment from weather as gauged in the household survey, the biggest disruptions occur in the winter months generally with the average peaking in February. There is an additional climb through the late-summer months due to disruptive hurricanes in some years. This September has seen hurricane activity but they’ve been less disruptive than some of the major events in years past, leaving modest upside weather-risk for payrolls. Of course, any weather related disruptions will be eclipsed by COVID-19.Hourly EarningsAs stated above, a flat figure for September average hourly earnings is anticipated, after gains of 0.4% in August and 0.2% in July, but drops of -1.3% in June and -1.1% in May, as we further unwind the 4.7% April surge. Job losses have been skewed toward lower paid retail, leisure and hospitality workers, and this prompted the April spike in average hourly earnings that is now being reversed. A 4.6% y/y increase in September from 4.7% in August is forecasted.Continuing and Initial ClaimsContinuing claims fell -1,912k between the September and August BLS survey weeks, after a drop of -2,459k between August and July, and a -2,280k drop between June and July survey. The economy is unwinding the 24,912k continuing claims peak in the second week of May. Initial claims fell to 866k in the September BLS survey week from 1,104k in the August survey week, and 1,422k in the July survey week. The September initial claims anticipate to average at 870k from 992k in August.ConclusionEmployment should rose further with output in September, despite delayed stimulus and ongoing disruptions in the re-opening process. The September hours-worked is expected to increase of 0.8%, with a 34.6 workweek, while hourly earnings remain flat. The jobless rate should hold steady at 8.4%, leaving the rate below the 9.98% cycle-high from the last recession in October of 2009.Always trade with strict risk management. Your capital is the single most important aspect of your trading business.Please note that times displayed based on local time zone and are from time of writing this report.Click HERE to access the full HotForex Economic calendar.Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!Click HERE to READ more Market news. Andria Pichidi Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
    • Date : 29th September 2020.Time for the first face-off.The first presidential debate is due to take place today, ahead of an election that is turning into a major event risk. At the same time markets are waiting for developments on further US stimulus measures as US Democrats released a USD 2.2 trillion proposal in a bid to break the deadlock in talks with Republicans. The debate is at 01:00 GMT while the focus turns on any potential market fallout especially as it coincides with indications of a possible approval of the fiscal stimulus but crucial with the approach of month- and quarter-end which could exacerbate volatility.Additionally in the US this week, there is also the threat of massive layoffs/furloughs from the airlines come October 1 as the CARES package provisions expire. Data remains thin for now. September consumer confidence headlines Tuesday, and is followed Wednesday with the ADP private payroll report, September ISM, vehicle sales, August income and consumption. Thursday has the high frequency jobless claims before Friday’s September nonfarm payrolls release.Now in regards to tonight’s debate, the importance of it does not rely solely due to the fact that is the every first debate but mainly because it might present the clear winner especially this year in which the candidates have not been as highly visible with limited campaigns done because of Covid-19.The candidates will be questioned for 90 minutes, without commercial breaks, according to the Commission on Presidential Debates. Ahead of the debate the vulnerable one look to be Trump following a New York time report that the president paid no income tax for 11 years. However is an excellent brutally effective debater so it will interesting to see how he will overcome any attacks. Please note that in some states voting has already started via mail or in person.The debate will take place at Case Western Reserve University and Cleveland Clinic in Cleveland, while the topics selected by Wallace, moderator of the first 2020 presidential debate, are the:   The Trump and Biden Records The Supreme Court Covid-19 The Economy Race and Violence in our Cities The Integrity of the Election Below you can also find the latest national polls prior the debate.Based on UBS research below we enclose the campaign policy platform of each Party:What is the 2020 Republican Party platform?President Trump abandoned the usual practice of endorsing a lengthy campaign policy platform in conjunction with the GOP national nominating convention. Instead, he released an abbreviated written agenda for a planned second term in office. The GOP policy statement is largely aspirational, with fewer details than one is accustomed to seeing from a presidential candidate. The president’s proposed fiscal policies include additional tax cuts for individuals and federal tax credits and deductions for corporations that repatriate jobs to the US from overseas locations. The statement also explicitly supports additional capital gains tax relief through an expansion of the Opportunity Zone program.Numerous provisions from the Tax Cuts and Jobs Act (TCJA) are scheduled to expire at the end of 2025, but the president does not discuss how the resulting tax hikes will be averted. Absent additional congressional action, the individual income tax cuts, an increase in the standard deduction, and the expanded child tax credit will all revert to prior levels in just over five years. Voters are left to assume that the president will be able to convince Congress to make the tax cuts permanent.The policy statement, which was released in conjunction with his acceptance speech, also focuses on the adoption of a more adversarial posture toward China, strict enforcement of immigration laws, and support for law enforcement personnel. While all three are viewed by the GOP as winning campaign strategies, the reference to “ending our reliance on China” suggests that the president is willing to continue to use tariffs as a tool of foreign policy if elected to a second term. He has threatened to selectively impose tariffs upon, and to strip government contracts from, companies that refuse to relocate their operations to the US.Meanwhile, in a rare instance of tacit agreement with his challenger, the president reaffirmed a desire to cut prescription drug prices, lower healthcare insurance premiums, and require coverage of all preexisting conditions. On the whole, the impact of the president’s policies on Treasury receipts (and on the US economy generally) is difficult to calculate. Whether or not this is purposeful is debatable, but the inevitable conclusion is that a second Trump administration would be similar to the first and forced to rely on deficit financing to accomplish its goals.What is the 2020 Democratic Party platform?In contrast to the president’s abridged policy statement, the Democratic Party platform is a protracted recitation of policies as disparate as the need for federal bankruptcy reform, a Green New Deal, and reinvestment in rural America. The Biden campaign has not released a consolidated fiscal plan but instead weaved his call for higher taxes to partially fund a series of spending proposals related to infrastructure investment, climate change, and an expansion of healthcare coverage. At its core, however, the Biden campaign is focused on strengthening the federal regulatory regime, reversing many of the provisions of the Tax Cuts and Jobs Act, and increasing federal funding of long-time Democratic policy priorities.The former vice president advocates an increase in the highest marginal tax rate to 39.6%, and higher payroll taxes for individuals earning more than USD 400,000 a year. He also proposes to tax capital gains at the same rate as ordinary income for taxpayers earning more than USD 1 million. The corporate tax rate is targeted for an increase, albeit less than the rate prevalent before the enactment of the Tax Cuts and Jobs Act. The corporate tax rate would increase from 21% to 28%, and an alternative minimum tax of 15% would be levied on companies that report more than USD 100 million in book income.The Democratic campaign platform also takes aim at the estate tax by recommending a reduction in the exemption to USD 3.5 million and the elimination of the stepped-up basis rule. Tax preferences for the fossil fuel industry would be eliminated, while those for energy efficiency would be increased. With the exception of the payroll tax increase, most of Biden’s fiscal policy platform could be implemented with a majority vote in the Senate through budget reconciliation.The Tax Policy Center has estimated that Biden’s tax proposals would increase federal revenue by about USD 4 trillion between 2021 and 2030, or 1.5% of GDP over a decade.1 Roughly half of the revenue gain would be derived from higher taxes on US households, with the remainder coming from businesses and corporations. The Tax Foundation expects the Biden tax plan to reduce after-tax income for the top 1% of taxpayers by 7.8%. The top 5% would see their after-tax income drop by 1.1%, with diminishing reductions thereafter as income declines.Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Andria Pichidi Market Analyst HotForex
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